Simon Gruber is the older brother of the villain from the first movie, Hans Gruber. Simon destroys a building in New York City. He says that he will destroy another one unless the police do what he tells them to do. His first task is to have John McClane to go Harlem and stand around for 15 minutes with a sign that says "I hate niggers" with his gun taped to his back so that he cannot reach it. A group of black men attack McClane. A shopkeeper named Zeus Carver saves McClane by grabbing the gun and getting into a taxicab.

The next task that Gruber has them do is to reach a pay phone. He then gives them a riddle and has them call back within 30 seconds to the right phone number (the answer to the riddle is the last four digits) or else the trash can full of explosives will be detonated. They call back with the right phone number but it is past 30 seconds. Carver and McClane duck out of the way as Gruber laughs.

The third task that Gruber sets for them is to reach the Wall Street subway station by 10:20 a.m. or else the station will be blown up. McClane and Carver steal a taxicab and cut through the park to reach the station in time. McClane stops at an earlier station and gets on the train. He then searches the train for the bomb and finds it. He throws it out of the cab car. Carver gets to the Wall Street station and picks up the phone, but because McClane is not there, Gruber says they did not follow his rules. The train rolls over the detonator and sets it off. The bomb explodes and destroys a large part of the station. McClane is injured but is alive.

The FBI come in and tell him that the man's name is Simon Gruber and that he is Hans' brother. Simon calls in again and tells him that he has placed a bomb inside one of the schools in New York City. Any attempt to get the children out will result in the bomb being blown up. He tells McClane and Carver to head to a park. The entire police force goes out and starts to search every school to find the bomb.

With the police gone, Simon Gruber and a bunch of dump trucks come in. They kill the security guards and begin to steal the gold from the vault in the Federal Reserve Bank of New York. McClane and Carver arrive at the park and find another bomb. They use a five-gallon and three-gallon jug to make four gallons and put it on the weight to disable it. McClane catches a kid stealing something; the kid says that there's not a cop for miles around. McClane then goes to the Federal Reserve building and walks in. As Gruber's men escort him down, he asks them about lotto numbers and realizes that they are not the real cops and kills them.

McClane then drives a car out to intercept Gruber and his men. He has Carver go out to Yankee Stadium since that's what Gruber originally told them to do. Gruber drives into a aqueduct. McClane follows them in, but they flood it, causing a ton of water to rush out. McClane grabs a ladder and is sent flying into the air. Meanwhile, Carver went to Yankee Stadium and did not find anybody. Two of Gruber's men with sniper rifles are there to kill him, but decide to follow Carver instead since McClane is not with him. Carver is driving on a highway and sees McClane as he is thrown into the air. A car chase and gunfight take place as Gruber's men show up to try to kill them.

McClane and Carver find Gruber loading the gold onto a cargo boat in New York Harbor. After getting in, a few battles take place and Carver and McClane are captured by Gruber's men. They are then tied up and Gruber sets the fuse to blow the boat up. Before leaving, Gruber tosses McClane a bottle of aspirin. Gruber claims he is blowing up $100 billion of gold bullion but there is nothing inside; he is trying to make the value of gold higher by "destroying" the supply. McClane and Carver work their way out of the cuffs and jump to safety as the ship blows up.

They are rescued by the police. On the ship, McClane takes a quarter to call his wife. As he is being connected, he takes an aspirin, looks at the bottom, and realizes that Gruber is heading to Canada. They intercept him and fly a helicopter over his ship. In the ensuring fight, Gruber gets in his own helicopter and shoots and hits their helicopter, forcing them to land. McClane starts running to make Gruber shoot at him. He notices a bunch of power lines and shoots them. The lines fall on Gruber's helicopter and kill him.